Relentless
00:11:06 · Ty Morse, Sam D'Amico, Aaron Slodov
[00:11:06] S2: There's none. [00:11:07] S0: There's there's none. And and, but in China, they're they're they're they're they're like 20 to 50. Maybe that there... Maybe their Elon's are not as good. You can debate that sort of thing, but like that... That's how their hardware ecosystem and software ecosystem as well works. And the benefit of that is if I'm a American entrepreneur that wants to build the most advanced device of its category, I can just go there and do it. [00:11:34] S2: Yep. So, Aaron, I think Elon on a podcast recently basically explained that right now most of The US's biggest companies effectively just export files that they send to China, and then those files are converted into actual products. [00:11:46] S0: Mhmm. [00:11:47] S2: With this, like, massive decline over the last forty five years, how do you actually think The US can reverse this decline? [00:11:53] S1: So part of, you know, this story and building my company and seeing this stuff kind of firsthand led me to also, you know, try to start a national movement around this, which is re industrialized. Right? And the idea of that is we have only so much, you know, tribal knowledge left in terms of how these systems work, how you can ultimately, you know, create a machine like that. But once it's gone, it's it's gone. And preserving tacit knowledge is very hard because it's not like the matrix where you just jump in and download. [00:12:35] S0: I know kung [00:12:36] S1: fu. Right.
00:12:36 · Sam D'Amico
[00:12:36] S0: Yeah. No. There's a take on this that's like machine... So I would also argue that like, effectively you machine learn or you reinforcement learn how to manufacture stuff. And China is incredibly good at this process. And so basically it's like, okay, if I'm... We can break this down to like a simple example of like, let's build a lithium ion battery cell. It's not really simple, but there's all of these process steps where you're basically like laminating film, like laminating films on top of each other with different chemical processes and like the like the makeup of the the powders you're using and like the settings on the machines that do certain steps. All of that stuff you can imagine, again, I'm I'm assuming your audience is full of a bunch of aspiring AI engineers or whatever. All those things are like implicit weights into a neural, like a neural network basically. Yeah. And you can pre train, you know, you can take all the knowledge in the world and design the best thing, the best single widget, but there is a reinforcement learning with factory feedback step that unless you build stuff at high volume, you will never achieve. And this is actually the thing that like, I've been talking to a number of folks doing kind of like new manufacturing things. And it's like, that is the key thing that I think a lot of people who have not been close to the process, they don't get basically. Yeah. Is this like implicit reinforcement learning aspect of it and the fact that like so much of the state of what makes advanced manufacturing work is not in the spec.
00:14:01 · Aaron Slodov, Sam D'Amico, Ty Morse
[00:14:01] S1: Yeah. It's it's a... If you think about it like a stateful system, it's impossible to observe until you have high throughput, which is mass production, basically. So... [00:14:11] S0: And who's gonna fund you for that? [00:14:12] S1: Exactly. It's it's very hard to understand all the parameters basically until you do it. So that's why, you know, the Chinese machine is so efficient because they are just gathering more and more tribal knowledge and it's gonna snowball out of control, right, until basically, like, we'll get to this later, but the humanoid thing is an insane problem, if it actually plays out. [00:14:38] S2: What do you mean by that?
00:14:39 · Aaron Slodov
[00:14:39] S1: Well, we'll get there. We'll get there. But my like, basically, the whole the whole purpose and MO of re industrialized, right, is that, I would prefer if we could preserve as much of that knowledge as we can, encapsulate it, and then rebuild it here. Right? And be able to have these kind of like reinforcement feedback loops because we're building better brains and like compute. And it's, in my opinion, it's not necessarily that like we need to live in a unipolar world with a single industrial superpower, but like there has to be another option. And I also... I don't believe that, like, autarky is a necessity. Right? Like, you can't... Trade is actually a good thing. However, when you do actually have an adversary on the world stage, you you cannot continually empower them. So part part of my, you know, ethos about this is that we have insanely deep capital markets. Like, we have the talent. Right? And it's just... This is where it comes down to a lot of people criticize this in terms of, like, you know, communist, like, central planning, basically, where you need, you... You're going to need this kind of capacity one way or another for for medicine, for electronics, right, chips, all of this kind of stuff. We scrambled to to cover like EV supply chains and chips really fast because those were you know critical at that time and it really just turns out that it's all it's all critical. If you forget how to make anything it's bad, right? So ultimately my my whole worldview is that like the toolbox is here. We need we need the people to actually like do it while we're still kind of, you know, working with China and other industrialized nations to produce the things that we want to build.
00:16:36 · Ty Morse
[00:16:36] S2: And Sam, same kind of question of with this massive decline, do you think like, a, it's reversible and how do we do that? And then if you had a $100,000,000 to invest in a factory today, where would you decide to put it and why?
00:16:49 · Sam D'Amico
[00:16:49] S0: That's the great set of questions. So first thing is, is this reversible? I think there's a silver lining to like some of the stuff when... Actually, I'll disagree with your point of like it's all important. It's, I think you can distill kind of all of the next set of devices into what I would call, like, the electric stack. And so this is... And and if you want a 200 page reading on this, Packy and I put together a really long article about the electric slide, but basically it's lithium ion batteries, power electronics, embedded compute, and then electromagnetics. And I would also add a fifth column, which is like computer vision hardware. So like I've I've worked on camera modules and image sensors and stuff like that. So like... But basically anything from a Waymo to a robot to a stove of all things, you can use those those those technologies and actually make stuff stuff happen. And so, basically, the idea is like pick devices that kind of give you... Let you exercise all of those key, like those four to five key muscles. Make sure there's a portfolio of them, some like portfolio of them that you can then selectively onshore and that... And make sure the volumes are high enough that you can get at least one of every process machine needed in that entire supply chain onshore and at a 100% capacity. Because the problem is, like, if if if I need, five different types of injection molding machines and I'm using each one of them for, like, you know, 10,000 parts a year, well, I'm not gonna be able to fund those. Like, it's not gonna... It's not... It's not gonna actually make sense. The flip side is, like, the only industrialist in The United States that has actually successfully done this recently, Well, one, he doesn't share it, does it in his own ecosystem. But two, but two, he actually can bring the volume to bear to actually go and do this. Like Starlink has enough, enough customers that they can fully do a lights out manufacturing line for that, that, that system, and it makes financial sense to do so. That said, how did he actually do it onshore at the beginning? It was like pandemic era, probably a pain in the butt to go to Vietnam or China or something like that to go and do this. They went and did it in the parking lot in in LA. And I think that goes back to where I... Where I put my factory. And it's like, it's incredibly important.